Automatic Stay

[waltercheryl]

Here are the facts:
1) Maryland bankruptcy
2) mother and daughter own real estate (both on deed and note)
3) daughter files chapter 13 to stop foreclosure
4) after about a year, daughter converts to chapter 7 after the stay was lifted as to the real property by the lender
5) in pertinent part, the order lifting the stay reads ORDERED that the Automatic Stay be, and it is, hereby terminated, by default as to the Co-Debtor, and by Consent as to the Debtor, pursuant to 11 U.S.C. 362(d), to permit Movant, its assigns and/or successors, to commence foreclosure proceedings…….
6) Lender files foreclosure action
7) mother who had never filed bankruptcy before, files a chapter 13 to stop the foreclosure
8) foreclosure is stayed.
9) Question: Will mother have to file a motion to extend the automatic stay beyond 30 days since the stay was lifted as to her by default in her daughter’s case? In other words, what effect does the lifting of the automatic stay in the daughter’s case have on the imposition and duration of the automatic stay in the mother’s case?

[despritfreya]

No, mom is not subject to Section 362(c)(3) as mom has not been a debtor in a bk dismissed within the preceding one year. She was a co-signer on the loan but not a debtor in bk. The Automatic Stay will protect the property until it is lifted by Motion or the dismissal of mom's case.

The term for the filing of consecutive bks by different individuals who have an ownership in real property, in an effort to "save" the property (or delay foreclosure) is "tag-team filings”. BAPCPA added Section 362(d)(4) to address this perceived problem. This provision requires the creditor to seek a determination that the most recent filing was done with the intent to hinder, delay or defraud. If such a finding were made the automatic stay of any subsequent bk, filed within 2 years, would not apply to that piece of real estate unless the debtor was able to persuade the subsequent judge to reimpose the stay.

Des.

[waltercheryl]

Thank you
BK forum is awesome.

[justbroke]

I was going to say the same thing as Des. Although I was going to just say "no", and he went right into a very detailed explanation.